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Treasury Laws Amendment (Prohibiting Energy Market Misconduct) Bill 2019

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8775 revised

2019

 

The Parliament of the

Commonwealth of Australia

 

THE SENATE

 

 

 

 

 

Treasury Laws Amendment (Prohibiting Energy Market Misconduct) Bill 2019

 

 

(1)     Clause 1, page 1 (line 13), omit “ Energy ”.

[reference to energy in short title]

(2)     Schedule 1, item 1, page 28 (after line 19), after Part XICA, insert:

Part XICB Egregious market misconduct

   

153ZE   Simplified outline of this Part

This Part sets out when a divestiture order may be made in relation to egregious market misconduct.

153ZF   Interpretation

                   In this Part:

associate has the same meaning as in the Foreign Acquisitions and Takeovers Act 1975 .

egregious market misconduct has the meaning given by section 153ZG.

interest , in an asset or a security, has the same meaning as in the Foreign Acquisitions and Takeovers Act 1975 .

153ZG   Egregious market misconduct

             (1)  A corporation engages in egregious market misconduct if:

                     (a)  the corporation engag es in conduct that contravenes section 46 (misuse of market power); and

                     (b)  any of the following apply to the conduct:

                              (i)  the conduct has the purpose, or has or is likely to have the effect of, eliminating or substantially damaging a competitor of the corporation, or of a body corporate that is related to the corporation, in a market;

                             (ii)  the conduct has or is likely to have the effect of significantly diminishing the access consumers have to a good or service in a market;

                            (iii)  the conduct engaged in by the corporation is part of a systematic pattern of conduct.

             (2)  In determining for the purposes of subparagraph (1)(b)(iii) whether the conduct engaged in by the corporation was part of a systematic pattern of conduct, regard must be had to the following:

                     (a)  the number of times (the relevant engagements ) the corporation, or a body corporate that is related to the corporation, has engaged in the conduct;

                     (b)  the period over which the relevant engagements occurred.

             (3)  Subsection (2) does not limit the matters to which regard may be had.

153ZH   Divestiture orders for egregious market misconduct

             (1)  The Court may, on the application of the Treasurer , the Commission or any other person, make an order under subsection (2) or (3) in relation to a body corporate if the Court is satisfied:

                     (a)  a corporation engaged in egregious market misconduct; and

                     (b)  the body corporate is the corporation or a body corporate that is related to the corporation; and

                     (c)  the order is a proportionate means of preventing the corporation, or any related body corporate, from engaging in that kind of misconduct in the future.

             (2)  If the body corporate is not an authority of the Commonwealth or an authority of a State or Territory, the Court may order the body corporate to:

                     (a)  dispose of interests in securities or assets, other than to any of the following:

                              (i)  another body corporate that is related to the body corporate;

                             (ii)  an associate of the body corporate; and

                     (b)  comply with conditions (if any) specified in the order in accordance with subsection (7).

             (3)  If the body corporate is an authority of the Commonwealth or an authority of a State or Territory, the Court may order the body corporate to:

                     (a)  dispose of interests in securities or assets to:

                              (i)  if the body corporate is an authority of the Commonwealth—an authority of the Commonwealth that is genuinely in competition with the body corporate in relation to which the order is made and that the Commonwealth has a controlling interest in that is equal to or greater than the controlling interest that the Commonwealth has in that body corporate; and

                             (ii)  if the body corporate is an authority of a State or Territory—an authority of that State or Territory that is genuinely in competition with the body corporate in relation to which the order is made and that the State or Territory has a controlling interest in that is equal to or greater than the controlling interest that the State or Territory has in that body corporate; and

                     (b)  comply with conditions (if any) specified in the order in accordance with subsection (7).

             (4)  To avoid doubt, the Court cannot make an order under subsection (3) for the body corporate to dispose of interests in securities or assets otherwise than in accordance with paragraph (3)(a).

             (5)  An order under subsection (2) or (3) must specify:

                     (a)  the interests in the securities and assets, or the kinds of interests in the securities and assets, that the body corporate must dispose of; and

                     (b)  the day by which the disposal must be made; and

                     (c)  any other matter that the Court considers necessary for the order to be effective.

             (6)  The day by which the disposal must be made must be no earlier than 12 months after the day on which the order is made.

             (7)  The order may specify conditions with which the body corporate must comply during the period between the making of the order and the disposal of an interest, if the Court is satisfied that those conditions are necessary to preserve any of the following:

                     (a)  the value of the interest;

                     (b)  in the case of an interest in an asset—the commercial operation of the asset.

             (8)  Without limiting the scope of subsection (7), those conditions may relate to any of the following:

                     (a)  the interest to be disposed;

                     (b)  if the interest is a share or other security in a body corporate—the exercise of rights attached to the share or other security.

             (9)  If a body corporate disposes of interests in assets to another body corporate as required by an order made under this section, then for the purposes of paragraph 311(1)(d) or 768AD(1)(d) of the Fair Work Act 2009 , there is taken to be a connection between the body corporate and the other body corporate as described in subsection 311(3) or 768AD(2), as the case may be, of that Act.

Note:          This means any employees of the body corporate who become employees of the other body corporate and satisfy paragraphs 311(1)(a) to (c) or 768AD(1)(a) to (c) will be transferring employees in relation to a transfer of business for the purposes of Part 2-8 or Part 6-3A of that Act.

153ZI   Acquisition of property

                   This Part has no effect to the extent (if any) to which its operation would result in the acquisition of property (within the meaning of paragraph 51(xxxi) of the Constitution) otherwise than on just terms (within the meaning of that paragraph).

[egregious market misconduct]